In 2008, Escalade and Sears could not agree on terms for products representing a significant amount of sales, despite the fact that these companies have a 30-year relationship! As a result, the company lost 12% of its sales just like that, and the remaining sales to Sears are now at high risk of being discontinued.

While Escalade may recover from this revenue shock by cutting costs and selling assets, it is not out of the woods yet. The stock has dropped by 80% in the last year, and the company is considering removing itself from the Nasdaq to save on costs!

When confronted with companies reliant on a few concentrated customers, look for contracts! If there aren't any, proceed with caution and understand the risks.